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Sky Weighs Up Its Options In The UK Telecoms Market

2/12/2014 by Stuart Wilson


Sky's decision to hire advisers to explore opportunities in the British telecoms and media market has left analysts suggesting there could be "merger mania" across the sector as rival organisations look to outdo one another.

The Financial Times reports that Sky is teeing up Lazard, the investment bank, to evaluate options for taking part in the wider UK telecoms consolidation that is taking shape throughout the sector.

It's likely that the move has been taken in response to the announcement that BT has opened talks with mobile operators O2 and EE as it looks to become a dominant force in its home market.

Vodafone, too, is also believed to be seeking ways in which it can capitalise on the jostling for position, with people close to the company claiming that a merger with US cable group Liberty Global is top of the UK company's wish list.

However, no agreement is being prepared or discussed with Liberty or any other group, according to those close to Vodafone.

"The horse has bolted out of the stable door," Deutsche Bank's telecoms analyst Robert Grindle told The Guardian. "The market now is going down a convergent route. The competitive forces have been unleashed and things are going to have to shake out."

With TalkTalk, Virgin Media and BT all set to offer mobile phone contracts by early next year, Sky is at risk of becoming the odd one out among British internet providers.

Jeremy Darroch, Sky's chief executive, hinted that the London-based firm may well follow suit, saying it would be "logical" for the company to offer mobile, but then suggested that British customers are yet to see the benefit of so-called "quadplay" packages of telecoms and TV.


Sky, UK, Telecoms & Internet, media, Vodafone, BT, O2, EE

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